Why do Lenders ask for Employment letters?

employment letters

Why do Lenders ask for Employment letters? Checking for employment letters might seem like just one more piece of paper, but it’s important.  It’s due diligence.  And it works on your behalf. A borrower will provide employment letters if requested when applying for a mortgage.  You will also need a current pay stub dated within 60 days. The mortgage broker informs the borrower for additional income documents.  A lender requests the most recent 2 years Notice of Assessments or T1 Generals (tax return) or T4s certainly if overtime or bonus income is used to qualify. Employment letters should provide the…

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8 Things to Consider Before you sign your Mortgage Renewal

Mortgage Renewal

8 Things to Consider Before you sign your Mortgage Renewal Approximately 47% of mortgages renew this year. There are several things to consider before you sign your next mortgage renewal! Have you explored all your options? Once you receive your mortgage renewal statement, there’s nothing easier than simply signing on for another term. But while this may make sense in many cases, your family or financial situation may have changed over time.  We can look for opportunities that could better meet your needs. Are you comfortable with your payments? If you’ve been feeling financially strapped each month making your mortgage…

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Interest Rates Rise

House Hunting: 5 Tips to help with the Homebuying Process
Prime Interest Rate Increased: What is the affect on your Variable Rate Mortgage?  It had been anticipated that Bank of Canada was going to increase their lending rate and they did by 0.25%.  Banks followed suit and increased their prime lending rate by 0.25%. There has been quite a stir recently putting many homeowners in a panic that rates were going to spike up quickly and concerns with those who are currently in variable rate mortgages. Banks prime rate increased to 2.95%, just under 3% that it was at September 2010.  It is a small increase of a quarter of percent. Nothing too major. My inbox and phone has been going steady with homeowners concerned with these changes.  Let’s have a look at the historical rates and the impact a 0.25% increase has on mortgage payments.

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Beware of Mortgage Penalties when Rate Shopping

Penalties

Understand your Mortgage Penalties when Rate Shopping is extremely important! Mortgage rates are at an all time low so it’s important to understand the penalties if you break your terms. Rates for a 5 year fixed mortgage have been hovering between 2.59%-2.99% for several months now. When a client comes to see me for a new mortgage, whether it is for a purchase, refinance or their existing mortgage is up for renewal, I will give them the best rate available. I put them in a product that is going to meet their needs and what is going to save…

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Is your HELOC costing you money?

Is your Home Equity Line of Credit costing you Money?   It was a trend years ago for your mortgage to be put into a home equity line of credit (HELOC) where you had access to revolving equity in your home and could pay down as you chose.  Back then, HELOC interest rates were close to fixed rates, making it attractive to have a open line of credit without any penalties. However, most have fallen into the trap of making interest only payments and not paying down that debt. The trend of HELOCs has faded as the Government of Canada…

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Buy now or wait for the rates to go down?

Buy now or wait for better rates ? Recently I was asked a great question from a local realtor.  Her clients are looking to buy BUT are on the fence about whether to buy now or wait 6 months to see if the interest rates go down. With the state of the economy now, there is anticipation that home prices may drop in the future, however there is also talk that mortgage interest rates are on the increase. What is the best option for saving money? Buy now or wait 6 months? There is no crystal ball in the mortgage world. …

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4 Tips to Manage a Layoff

4 Tips to Manage Your Finances When Faced with a Layoff The Canadian economy is in a recession and there are uncertain times for many. Low oil prices and the change of both Provincial and Federal government leadership has had a tremendous impact on the economy, resulting in many layoffs in 2015. More layoffs are predicted in the upcoming months. What happens if you have lost your job or are faced with a huge income cut? Losing a job or facing an income reduction is an emotional time when many are already living pay check to pay check. Step out…

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Be Life Rich, Not House Poor

be life rich not house poor

BE LIFE RICH, NOT HOUSE POOR! Buying at the top end of your pre-approval price could be setting you up for many dull years to follow. WHY? Because, your home cost is more than just a mortgage payment. There are property taxes, maintenance, utilities and more due every month. If those add up to 35% of your total income, you’re on the right track. If not you might have to sacrifice in other categories such as vacation, debt repayment or savings. Budgeting is really a piece of cake, or a pie in this circumstance. The pie chart here illustrates a…

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Annual Mortgage Reality Check

A Mortgage Reality Check Most of us tend to think of our mortgage as the ultimate “buy and hold” purchase. After all, who wants to spend any more time in the “borrower” chair than is absolutely necessary? You get a 5- year term, and then go on automatic pilot until it comes due again. You might wring your hands over your other finances, but your mortgage is set in stone, right? Well, not exactly. In fact, it’s a great idea to have an annual mortgage review to see if it’s really working for you – especially in the context of…

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